MAC D4-1

wsantos

(40 points) Discuss which would be a better investment if you were investing for a period of 5 years. Please provide all details.
- Option 1: $2000 invested at 6% compounded quarterly
- Option 2: $2000 invested at 2% compounded continuously
(40 points) You just had a baby and want to invest for his college tuition. You found two different accounts:
In account one you have to invest $2500 at 2% compounded monthly.
In account two, you have to invest $2000 at 4% compounded annually.
If you predict that your child will be entering college in 17 years, which account would produce more interest over that time?